Calculator
Blend-and-extend calculator
Instead of breaking your mortgage, some lenders will blend your current rate with today's rate and extend the term. This shows a time-weighted estimate of that blended rate next to the penalty you would avoid.
Estimated blended rate
4.89%
Three months' interest (for comparison)
$4,804
Simplified IRD
$7,000
A blend-and-extend usually avoids a prepayment penalty by mixing your current rate with today's rate, weighted by time. Lenders set their own blending method and may add fees — ask for the exact blended rate in writing.
Illustration: time-weighted average of the old rate (for the months left) and the new rate (for the rest of the new term).
How it works
- Blended rate ≈ (current rate × months left + new rate × remaining months of the new term) ÷ new term.
- The penalty figures use three months' interest and a simplified IRD for comparison.
Questions people ask
Do all lenders blend this way?
No. Each lender sets its own method and may add fees. Use this as a sanity check on the rate you are quoted.
When does blending make sense?
When you need to change your mortgage before maturity and the penalty to break would be large. Compare the total cost both ways.
Does blending reset my term?
Usually it extends to a new full term, which can lock in a rate for longer than you planned.